Wholesaler moves to torpedo Wesfarmers’ API bid.

Sigma Healthcare is looking to join the race to take control of rival wholesaler, Australian Pharmaceutical Industries (API), with a $794.9 million bid. 

The unsolicited, indicative, non-binding and conditional proposal would see Sigma acquire 100% ownership of its competitor for a combination of cash and scrip, valuing API shares at $1.57 - $0.02 more than Wesfarmers’ bid (PD 16 September).

Under the terms of the Sigma bid, API shareholders would receive $0.35 cash, plus 2.05 Sigma shares for each API share. 

In a statement to the Australian Securities Exchange this morning, API’s Board noted that Sigma’s proposal was “reasonably capable of being valued and completed and would be likely to be - if completed substantially in accordance with its terms - more favourable to the shareholders of API as a whole than the latest proposal provided by Wesfarmers”.

“On this basis, the Board believes it is in the interests of API shareholders to progress the Sigma Indicative Proposal and allow Sigma to undertake confirmatory due diligence to facilitate a binding offer in parallel with the confirmatory due diligence being offered to Wesfarmers,” API said.

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